EXHIBIT 20.3
MASTER LEASE AGREEMENT
This lease dated May 1, 1994, between SPS Technologies, located at 0000
X. Xxxxxx Xxxxxxxxx, Xxxxx Xxx, Xxxxxxxxxx (hereinafter called "Lessor"), and
Fireplace Manufacturers Incorporated, with principal offices located at 0000 X.
Xxxxxx Xxxxxxxxx, Xxxxx Xxx, Xxxxxxxxxx (hereinafter called "Lessee").
Whereas, Lessor is the owner of land and/or buildings located at 0000
X. Xxxxxx Xxxxxxxxx, Xxxxx Xxx, Xxxxxxxxxx; and
Whereas, Lessee desires to lease industrial space upon Lessor's
premises, more fully described herein, from Lessor for the purpose of
manufacturing fireplaces.
Whereas, Lessor is willing to lease to Lessee such premises on the
terms and conditions set forth herein.
Now, therefore, in consideration of the covenants and agreements herein
contained, the parties do hereby agree as follows:
1. Lessor leases to Lessee and Lessee takes from Lessor certain
premises situated at 0000 X. Xxxxxx Xxxxxxxxx, Xxxxx Xxx, Xxxxxxxxxx, and more
particularly described and identified as follows: 4,000 square feet of office
space; 75,600 square feet of manufacturing space; and 5,700 square feet of
storage space, for a total of approximately 85,300 square feet of space, as
represented on Exhibit "A".
2.A. The terms of this lease shall commence on May 1, 1994, and
continue for a 5 (five) year period unless sooner terminated in accordance with
the terms hereof.
B. Option to extend - there is no option to extend this lease.
C. Should the lessee or lessor wish to negotiate a new lease then
that party must notify the other party of its intention between the dates of May
1, 1998 and November 1, 1998.
3.A. Effective May 1, 1994, Lessee agrees to pay Lessor a monthly
rental amount of Twenty Two Thousand Seven Hundred and Sixty Eight Dollars
($22,768.00) in advance on the first day of each month.
B. Notwithstanding the monthly rental amount specific in subsection
A above, the monthly rental amount shall be adjusted upward on each anniversary
of the beginning of the lease term by an amount equal to the percentage increase
in the Consumer Price Index (CPI) for the State of California during the
previous calendar year, but in no even less than two percent (2%) or more than
five percent (5%). Such increases shall be
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computed based upon the monthly rental amount in effect on each anniversary
date.
C. For the first twenty four months of the lease term ONLY, the
monthly rental amount determined in accordance with the provisions of
subsections A and B above, shall be reduced by Four Thousand Seven Hundred
Ninety One Dollars ($4791.00) to a monthly rental amount of Seventeen Thousand
Nine Hundred Seventy Seven Dollars ($17,977.00).
D. All rent shall be payable to Lessor at: SPS Technologies,
Inc. Jenkintown Plaza, 000 Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000,
Attention: Xxxx XxXxxxx, or at such other place as Lessor may from time to time
designate in writing.
E. Although the lease area (85,300 square feet) is considered to
be approximately accurate, both the lessor and lessee reserve the right to have
the rental amount adjusted using the agreed rate of $.2669 per square foot per
month on the area occupied which will be measured after the Lessee has completed
the move of its office and equipment.
4.A. Lessee agrees to defend, indemnify and hold harmless
Lessor, its officers, agents and employees, from and against all claims,
damages, losses and expenses, including attorneys' fees, for personal injury to
or death of any person or
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loss or damage to property of any person arising as a result of the condition of
the leased premises, and from and against all claims, damages, losses and
expenses, including attorneys' fees, for personal injury to or death of any
person, including employees of Lessor, or loss of or damage to property of
Lessor or any person, including employees of Lessor, arising as a result of
Lessee's use and occupancy of the leased premises or its use and occupancy of
other land or building owned by Lessor, howsoever occurring. This paragraph and
the obligations contained therein shall not apply to any negligence of Lessor,
whether active or passive.
B. Lessee agrees to defend, indemnify and hold harmless Lessor, its
officers, agents and employees, from and against all claims, damages, losses,
liabilities and expenses, including attorneys' fees, arising out of or in
connection with the storage, handling, disposal or discharge of oil, chemicals
and/or hazardous wastes or substances. This paragraph and the obligations
contained therein shall not apply to any negligence of Lessor, whether active or
passive.
5.A. Lessee intends to use the leased premises for the purpose of
manufacturing fireplaces. Lessor hereby authorizes the use of the leased
premises for such purpose. Lessee agrees that it will not use, or permit the
leased premises to be used, for purposes other than those authorized herein.
B. Lessee agrees that it will so supervise its personnel that their
activities will be limited to the leased premises, and they will not be
permitted to enter upon other
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areas of or buildings owned by Lessor.
C. Lessee agrees that it will conform to and obey all present and
future laws and ordinances, and all rules, regulations, requirements and orders
of all governmental authorities or agencies, respecting the use and occupancy of
the leased premises.
D. Lessee agrees that it will comply with all requirements of
Lessor's insurance carriers regarding employee safety, building, or equipment
exposure. All expenses related to such compliance shall be at Lessees' sole
cost.
6. Lessor reserves the right, for itself and its employees, agents
or contractors, and Lessee agrees to permit Lessor, its employees, agents or
contractors, to enter any and all portions of the leased premises at any and all
reasonable times, after reasonable notice, for the purpose of performing
inspection, maintenance, repairs, or showing for sale or for lease.
7.A. Lessor shall pay general real property taxes, and all other
taxes and assessments imposed on or against the land and the building.
B. Lessee shall pay for the cost of electricity, gas, water,
telephone and other utilities and services supplied to the leased premises
together with any taxes thereon and personal
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property taxes due as a result of the personal property valuation of the assets
of the Lessee. If any such services are not separately metered to Lessee, Lessee
shall pay a reasonable proportion, to be determined by Lessor, of all charges
jointly metered with other premises. The amounts billed by Lessor to Lessee for
utilities shall be considered as additional rent hereunder by Lessor with an
accounting provided by Lessor to Lessee. Lessee shall have option to audit all
records relating to.
X. Xxxxxx shall contract for and obtain security guard service or
the building Lessee shall reimburse Lessor for the cost billed by the security
guard service to Lessor for the North Gate. The amounts billed by Lessor to
Lessee for security guard service shall be considered as additional rent
hereunder. Any amount billed to Lessee hereunder shall be approved by Lessee in
advance of contract.
8. Lessee agrees that it will make no alterations to or
improvements in or to the leased premises, including the utility systems
therein, without the prior written consent of the Lessor. It is further agreed
that any alterations or improvements which are approved by Lessor and which are
made by Lessee shall be at Lessee's expense and, at the end of the term hereby
granted, Lessor, if it so desires, shall have the right to purchase the
alterations or improvements, provided the parties can agree on a price. In the
event the parties cannot agree on a price, or Lessor shall not desire to
purchase the alterations or
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improvements, Lessee shall restore the leased premises to the condition as
originally leased. Should Lessee fail to remove such alterations or
improvements, title to such alterations or improvements shall pass to Lessor,
who may remove or repair such alterations or improvements at Lessee's expense.
Lessor's removal and/or Lessee's failure to remove such alterations or
improvements shall not release Lessee from its obligation to restore the leased
premises to the condition as originally leased.
9.A. Lessor shall and will, during the term of this lease, keep in
effect fire insurance coverage on the premises; however, Lessee agrees that all
of its property, equipment and supplies located on the premises shall be insured
by Lessee at its own expense.
B. Lessee shall, at all times during the term of the lease, keep
in effect with reputable carriers, Workmen's Compensation and Comprehensive
General and Liability Insurance in the following minimum limits:
Workmen's Compensation Statutory
Employer's Liability $500,000
Comprehensive General Liability Bodily Injury & Property
including Contractual Liability Damage $2,000,000 combined
single limit
Comprehensive Automobile Liability Bodily Injury &
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Property Damage $2,000,000 combined
single limit
C. The insurance policy(ies) providing the required
coverage shall contain endorsements providing for Contractual Liability
Insurance specifically insuring the obligations contained in Article 4 of this
lease agreement.
D. Lessee will furnish Lessor with certificates of
insurance evidencing the above-specified coverage. Such certificates shall
provide for thirty (30) days notice to Lessor in the event of cancellation or
other termination of such insurance.
E. In the event Lessee obtains Lessor's approval to have
work performed on the leased premises by others, Lessee shall assure that its
contractors will comply with the provisions of this lease including, but without
limitation, provisions relative to safety, security, insurance and use.
F. Anything in this lease to the contrary
notwithstanding, Lessor and Lessee each waive any rights of recovery against the
other or against employees of the other who may be responsible for a loss to
property covered or intended to be covered under a fire insurance policy or
policies, including the perils of the extended coverage endorsement, vandalism
and malicious mischief.
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10. Lessee shall, at the expiration or termination of this
lease, vacate the premises in as good a condition as they were at the time of
entry thereon by Lessee, except for reasonable wear and tear.
11. Lessee agrees to comply with all reasonable safety,
security and parking rules and regulations that have been or may be promulgated
by Lessor.
12. Lessee shall not cause or permit any liens or encumbrances
to be placed upon the leased premises.
13. Lessee shall not assign this lease or any interest
thereunder or sublet the premises or any part thereof without the prior written
consent of Lessor.
14. The covenants and agreements contained in this lease shall
apply and inure to the benefit of and be binding upon the parties hereto and
upon their successors in interest, legal representatives and assigns, except as
otherwise hereinbefore provided in the immediately preceding paragraph.
15. All notice to be given hereunder shall be sent by
certified mail, return receipt requested, properly addressed and with postage
prepaid. If sent to Lessor, said notice shall be to:
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SPS Technologies, Inc.
Jenkintown Plaza
000 Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxx X. XxXxxxx
Vice President,
Corporate Services
If sent to Lessee, said notice shall be
sent to:
Fireplace Manufacturers Incorporated
0000 X. Xxxxxx Xxxx.
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
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16. This lease contains all representations and agreements of
and between the parties hereto and supersedes any prior leases, agreements,
negotiations or representations by or between the parties. It shall not be
modified or amended except by a written instrument duly executed by all parties.
Addendum 1 is incorporated herein by reference.
With Modifications to 5A and B
Witness the due execution hereof the day and year first above written.
SPS Technologies, Inc.
Executed at Jenkintown, PA By: /s/ Xxxx X. XxXxxxx
---------------------------- --------------------------------
Xxxx X. XxXxxxx
Date 5/13/94 Vice President,
------------------------------------ Corporate Services
"Lessor"
Fireplace Manufacturers Inc.
Executed at Santa Ana, CA By: /s/ Xxxx X. Xxxxxxx
---------------------------- --------------------------------
Date 5/26/94 Title: COO FMI
----------------------------------- ----------------------------
"Lessee"
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ADDENDUM TO LEASE
Dated 5/13/94
----------
Between SPS Technologies, Inc. and Fireplace Manufacturers, Inc.
1. Lessee's use of the leased premises shall be further restricted in that
Lessee's storage of any and all products, materials, tools, equipment and other
items shall comply with the maximum height restrictions hereinafter set forth:
Maximum Height Restrictions
---------------------------
Palletized Storage Rack Storage
------------------ ------------
Metal 15' 12'
Flood & Cardboard 6' 6'
Plastics 8' 8'
Chemicals Each situation must be reviewed by Lessor's
insurer, Industrial Risk Insurers
2. Lessor is to provide fencing around the perimeter of the leased space at
Lessee's cost and expense.
3. Without limiting the provisions of paragraph 8, Lessee hereby agrees that
it will dismantle and remove the four (4) story test tower facility prior to
vacating the premises at the expiration of the term of this lease. Lessee
further agrees to repair and/or replace the roof area of the building over the
test tower facility to its original condition prior to placement of
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the test tower facility, or better. The reconstructed roof area shall match the
existing quality of the crane bay roof.
7. Lessor shall continue to hold the $16,835 security deposit formerly paid by
Less.
5. Relocation Breach -
A. It is expressly understood that the Lessee (i) will relocate
their existing offices area to the office area previously occupied by Lessor
(approximately 4,000 feet); (ii) will relocate the brick manufacturing
operation to the maintenance area previously occupied by the lessor; and,
(iii) will realign the manufacturing area through the HIGH BAY AREA of the
plant in accordance with the following timetable:
(a) complete the relocation of offices "within thirty days (30) after the
office complete and ready to be executed by Lessee" 5/26/94
(b) complete the relocation of the brick manufacturing facility "within thirty
days after Lessee has completely removed equipment, structures and property from
the maintenance." 5/26/94
(c) complete the realignment of fireplace manufacturing into the HIGH BAY AREA
within 120-180 days after the Lessor has constructed the new dock area for the
Lessee.
B. Should the lessee fail to meet the above schedule or not making
sufficient progress to meet the above schedule, Lessor may notify Lessee in
writing that a breech of this provision has occurred. Upon receipt of this
notice Lessee shall cure such breach within 14 days and notify Lessor in writing
of such cure. Should the Lessee fail to cure the breech, the Lessor may
terminate the Master Lease Agreement in its entirety upon 30 days written
notice.
6. Relocation Option -
Lessor may at Lessor's sole expense require Lessee to relocate its
office/manufacturing area in whole or in part in order to permit the vacant
space in the building to be leased.
SPS Technologies, Inc.
Executed at Jenkintown, PA By: /s/ Xxxx X. XxXxxxx
---------------------------
Date: 5/15/94 Xxxx X. XxXxxxx
Vice President
Corporate Services
"Lessor"
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Fireplace Manufacturers Inc.
Executed at SANTA ANA, CA. BY: /s/ Xxxx X. Xxxxxxx
--------------------------- ---------------------------
Date 5/4/94 Title: COO
----------------------------------- -----------------------
"Lessee"
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